Slide 1: Positioning for Growth
Positioning for Growth Full Year and Fourth Quarter 2017 Earnings and 2018 Outlook Call: March 28, 2018
Slide 2: Advisories
Advisories This presentation contains forward-looking statements. All statements, other than statements of historical fact that address activities, events or developments that Frontera Energy Corporation (the “Company” or “Frontera”) believes, expects or anticipates will or may occur in the future (
Slide 3: Frontera Energy Corporate Snapshot
Frontera Energy Corporate Snapshot 2017 Production Mix Capital Structure(1) Natural Gas Shares Outstanding (TSX: FEC; MM) 50 Heavy Oil Market Cap ($MM)(2) $1,563 8% Cash and Cash Equivalents ($MM)(3) $644 / $512 38% 70.1 Long-Term Debt (BB- Rated; $MM)(4) $250 Mboe/d Enterprise Value ($MM)(2) $1,412
Slide 4: Frontera's Strategic Initiatives
Frontera’s Strategic Initiatives Significant Value with Catalysts 2017 Results 2017 Actual 2017 Guidance Result Exit Production (boe/d) 71,015 70,000 to 75,000 Capital Expenditures ($MM) 236 250 to 300 Operating EBITDA ($MM) 390 300 to 350 1. Additional Catalysts to Unlock Value in 2018: • Contract
Slide 5: 2018 Outlook and Guidance
2018 Outlook and Guidance Investing for Growth 2018 Capital Expenditures and Other Forecasts 2017 Actual 2018 Outlook Change Operating EBITDA(1) $390MM $375 - $425MM 3% Total Capital Expenditure Budget $236MM $450 - $500MM 101% Average Net Production 70 Mboe/d 65 - 70Mboe/d (4%) Brent Oil Price $54.
Slide 6: Llanos 25: "Big E" Exploration
Llanos 25: “Big E” Exploration Potential 2018 Reserves Growth and 2019 Production Growth • Proven hydrocarbon fairway on trend with Cusiana and Cupiagua fields • 273 km2 of high-quality 3D seismic and extensive reprocessed 2D seismic • Acorazado prospect: Unrisked 154 MMBbl mean OOIP(2) • Up to 50%
Slide 7: Peru Block Z1
Peru Block Z1 Frontera’s First Offshore Exploration Well • Two producing fields: Corvina and Albacora • Delfin-1X (Delfin Sur) exploration well to spud in Q2 2018 • Close proximity to Corvina production platform • Multizone oil and gas potential • P50 OOIP: 125 MMBbl(2) • Close proximity to Talara r
Slide 8: 2017 Operational & Financial Highlights
2017 Operational & Financial Highlights Stabilizing Production, Focusing on Value 2017 2016 % Chg. PRODUCTION / REVENUE / PRICE Production decrease following financial restructuring and reduced Total Production (Boe/d)(1) 70,082 79,671 (12%) capital expenditure activity Brent oil prices increased 21
Slide 9: Fourth Quarter 2017 Operational & Financial Highlights
Fourth Quarter 2017 Operational & Financial Highlights Continued Strong Operating EBITDA and Adjusted FFO Growth Q4 2017 Q3 2017 % Chg. PRODUCTION / REVENUE / PRICE Production decrease as a result of social issues in Peru and natural Total Production (Boe/d)(1) 64,445 71,068 (10%) declines in light
Slide 10: Q4 2017 Operational Highlights
Q4 2017 Operational Highlights Peru Downtime Impacts per boe Metrics Production Profile: Stable Production Mix: Balanced Mboe/d 72.5 72.4 71.1 69.4 65 -70 Natural Gas 70 64.4 60 8% 50 Heavy 40 64.4 41% Oil 30 Mboe/d 20 51% Light & 10 Medium Oil 0 Q416 Q117 Q217 Q317 Q417 2018F Colombia Peru Realized
Slide 11: 2017 Reserves Evaluation Results
2017 Reserves Evaluation Results 2P Net Reserves - MMBOE NPV by Category @ 10% (MMUSD) 200 3,000 27 -26 2,523 2,500 2,324 -18 150 589 2,000 1,932 1,918 751 402 494 1,500 712 100 620 458 171 567 154 1,000 50 1,222 1,072 500 953 857 0 Before Taxes After Taxes 0 2017 2016 2017 2016 2P Reserves Addition
Slide 12: Quifa: Cornerstone of Heavy Oil Development
Quifa: Cornerstone of Heavy Oil Development Exploration and Development Upside at Cajúa & Jaspe YE 2016 Reserve Report YE 2017 Reserve Report Field expansion, reserves and production increase: • 3 vertical wells recently completed in Quifa and 3 of 4 in Cajua • Increased 2017 reserves by 11 MMbbl 2P
Slide 13: Guatiquía: Building on Deep Llanos Success
Guatiquía: Building on Deep Llanos Success Development & Near Field Exploration Opportunities • Ardilla-4 proved down-dip extension of the ACA field to the north; Alligator-1 and 2 exploration wells proved extension to the west • Alligator-3 and Alligator-4 to delineate Alligator field • 2017 develo
Slide 14: Financial Highlights
Financial Highlights Strong, Stable Balance Sheet and Stable Costs Balance Sheet Metrics (December 31, 2017) Cash Balances(1): Stable $ millions Total Cash(1) $644 million 600 132 90 99 102 114 Unrestricted Cash $512 million 400 470 501 512 439 Working Capital $310 million 200 389 - Long Term Debt $
Slide 15: Balance Sheet Strength
Balance Sheet Strength Strong Cash Position, Low Leverage Ratios Balance Sheet Metrics (December 31, 2017) Cash and Cash Equivalents ($MM)(4) $644 Net Debt/EBITDA(1) 0.1x Debt to Book Capitalization(2) 16.3% Interest Coverage(3) 15.6x No debt maturities until 2021 Credit Ratings Outlook: Stable Fitc
Slide 16: 2018 Brent Oil Price Hedging Summary
2018 Brent Oil Price Hedging Summary $74 Floor Ceiling FWD Mar 27th Positions executed as of today $69.79 $70 $69.07 $69.31 $68.83 $68.37 $67.94 $67.53 $67.10 $66.89 $65.68 $66 USD/bble $62 60.05 59.31 61.63 59.22 $58 55.73 55.86 55.91 55.45 55.28 55.37 53.83 $54 53.42 52.00 52.42 $50 51.10 51.23 50
Slide 17: Q&A Session
Q&A Session
Slide 18: Investor Relations Contact
INVESTOR RELATIONS CONTACT: Grayson Andersen Corporate Vice President, Capital Markets +57-314-250-1467 gandersen@fronteraenergy.ca ir@fronteraenergy.ca